The latest sign that Hong Kong’s property market has taken a turn for the worse came on Monday when just half of the new flats on offer at a mass housing project in Yuen Long managed to find buyers.

Henderson Land Development and New World Development had sold just 76 of the 152 small units up for grabs at Reach Summit by 8:30pm, a hugely disappointing figure in a city used to seeing new batches of apartments snapped up on the first day.

The flats at Reach Summit ranged in size from 195 to 370 square feet and were priced from HK$3.18 million, after a 3 per cent discount.

The poor showing comes amid growing evidence that the world’s most expensive property market is on the turn.

“The number of investors has obviously plummeted under the volatile stock market, which has further slowed the housing market after the rise in the prime [mortgage] rate,” said Louis Chan, vice-chairman of Asia-Pacific and chief executive of Centaline Property Agency.

Prices of used homes dropped for a second consecutive month in September, by 1.44 per cent.

Shih Wing-ching, founder of Centaline, said they could slide by 30 per cent in the next three years under sustained pressure from the US-China trade war.

“Winter has come,” said Shih, referring to the recent decline in prices and turnover.

Only 37 flats changed hands at 50 benchmark housing estates tracked by Ricacorp Properties in the week ended November 4. The number of used homes that changed hands in October dived 15.5 per cent to 1,957, according to Midland Realty.

Chan from Centaline attributed the slide in home prices and turnover to the stock market slump and rising interest rates which are pushing up mortgage repayments.

“Pessimism among buyers is spreading. Buyers are not confident,” said Chan. “Homeowners’ price cuts are also not as high as what buyers expect so a number of buyers will rent instead and wait for the best time to buy.”

New mortgage applications plummeted 55.6 per cent in September from a month earlier to 7,977, according to data from the Hong Kong Monetary Authority. That is the biggest monthly decrease in 20 years and the first time the number has fallen below 10,000 in 13 months.

Hong Kong could see six new projects comprising 2,471 units launched this month, including the 24 villas at Far East Consortium’s Manor Parc in Yuen Long, and the 1,025-unit phase one of Sino Land and China Estates Holdings’ Grand Central development in Kwun Tong.

Despite the signs pointing to a slide in home prices, Norman Chan Tak-lam, chief executive of Hong Kong Monetary Authority, insisted it is too early to say the slowdown is long-term.

Chan told lawmakers on Monday that the HKMA, Hong Kong’s de facto central bank, would relax mortgage restrictions if that changed.